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The developer who plans to construct two residential towers and a mixed-use building at the current site of Mollie Stone’s Market this week submitted a revised application for what would be Palo Alto’s tallest and most ambitious builder’s remedy project.
The application, which Redco Development filed on March 12, makes relatively minor design revisions to the project that it unveiled last October in a preliminary proposal. Two apartments are moved from the taller tower to the shorter one and the new proposal is requesting a vesting tentative parcel map so that the commercial and residential portions of the development would be owned by different legal entities, according to the new plans.
In most respects, however, the project remains unchanged from the initial proposal. Like the prior one, it would have a total of 382 housing units. The existing Mollie Stone’s Market would be demolished and replaced with one 17-story residential tower with 192 dwellings and another seven-story building with 112 dwellings and commercial space that would be occupied by the new Mollie Stone’s.
The other residential tower would be 11 stories high. It would go up across Cambridge Avenue and would include 78 apartments.
Of the 382 total apartments in the three buildings, 77 would be designated for “low income” residents — those who make up to 80% of the area median income, according to the newly filed application. The other 305 would be offered at market rate, according to the application.
While the proposal from Redco Development is part of a wave of builder’s remedy projects that the city has received over the past year, it is exceptional in key ways. Most of the other proposals are clustered in south Palo Alto, along a stretch of El Camino Real in Ventura and Barron Park neighborhoods. One builder’s remedy project, which is being proposed by Jeff Farrar targets a site further south at 3997 Fabian Way, where he hopes to build 292 apartments, according to a preliminary application that he filed in November 2023.
The Redco Development is the only builder’s remedy project that would go up in north Palo Alto, a geographical designation that is generally defined by its relation to Oregon Expressway and Page Mill Road. The site is immediately next to the California Avenue Caltrain station and is at the heart of the city’s “second downtown,” a commercial strip that Palo Alto City Council is eager to beautify and revitalize.
Chris Friese, managing partner at Redco, told his publication in a November interview that his team felt the location is perfect for the site from an urban planning standpoint.
“There’s no better spot than this one,” Friese said.
It is also the tallest proposal of the bunch. Most of the other projects propose buildings that are between 80 and 85 feet tall, which is well above the historical height limit of 50 feet. The two towers in the Redco proposal would be 177 and 123 feet tall, respectively.
Like most recent builder’s remedy proposals, the new Redco application came with a letter from the law firm Holland & Knight LLP, which is also representing developers in the El Camino Real area. The letter argues that Palo Alto remains subject to the builder’s remedy, a provision in state code that allows developers to exceed zoning regulations in jurisdictions that do not have compliant housing plans. In Palo Alto, the city council approved its new Housing Element in May 2023 but the state Department of Housing and Community Development subsequently deemed it non-compliant and demanded further revisions.
“HCD has specifically determined that a jurisdiction is not in substantial compliance with Housing Element law until HCD finds it to be so, saying that ‘a jurisdiction does not have the authority to determine that its adopted element is in substantial compliance but may provide reasoning why HCD should making a finding of substantial compliance,'” attorneys Daniel Golub and Genna Yarkin wrote in the March 6 letter.
Accordingly, they wrote, the city council’s finding of substantial compliance is “of little consequence” given HCD’s subsequent rejection.
Palo Alto is now planning to submit its next version of the Housing Element in late spring. The revised plan will include, among other things, recently approved zoning reforms that loosen height and density limits along El Camino Real as part of a new “housing focus zone.” The city council and the Palo Alto Planning and Transportation Commission plan to discuss the Housing Element on April 15.
City Manager Ed Shikada said that staff has been consulting with the HCD on developing the new policies in hopes of getting its next submission approved.
“We don’t have any guarantee that that consultation will result in an approval,” Shikada told the council on Feb. 26. “But staff believes this significantly improves the likelihood of having approval by the HCD — by having this consultation prior to the item being brought forward for City Council for adoption, or re-adoption.”
